Skyward Specialty Insurance Group, Inc. (SKWD) | Investment Case

1. Company Snapshot

1.a. Company Description

Skyward Specialty Insurance Group, Inc., an insurance holding company, engages in underwriting commercial property and casualty insurance coverages in the United States.The company offers general liability, excess liability, professional liability, commercial auto, group accident and health, property, surety, and workers' compensation insurance products.Skyward Specialty Insurance Group, Inc.

was incorporated in 2006 and is headquartered in Houston, Texas.

Show Full description

1.b. Last Insights on SKWD

{"title": "Adobe Inc. Performance Analysis", "intro": "Weak guidance and slowing growth drive Adobe's recent performance, with existential challenges facing the company.", "body": "Adobe's growth is slowing due to weak guidance, with the company facing existential challenges. The introduction of a new high-end graphics tablet, the Adobe Photoshop, has been met with mixed reviews, with some critics praising its advanced features while others have expressed concerns over its high price point. Additionally, the company's decision to discontinue its popular Adobe Creative Cloud subscription service has been met with backlash from customers, who are now forced to purchase individual software licenses. Furthermore, the company's recent acquisition of a rival graphics software company has raised antitrust concerns, with some regulators questioning the deal's impact on the market. Overall, Adobe's recent performance has been marred by a series of missteps, which have contributed to the company's slowing growth."}

1.c. Company Highlights

Last Price	46.8
Change Percentage	-1.52%
Open	47.63
Previous Close	47.52
Market Cap ( Millions)	1895
Volume	188992
Year High	65.05
Year Low	41.28
M A 50	47.28
M A 200	51.87

FCF Yield	19.60%
Dividend Yield	0.00%
ROE	16.11%
Debt / Equity	12.44%
Net Debt / EBIDTA	-21.31%
Price To Book	1.97
Price Earnings Ratio	13.41
Price To FCF	5.1
Price To sales	1.42
EV / EBITDA	9.76

2. Skyward Specialty's Q3 2025 Earnings: A Strong Performance

Skyward Specialty reported a robust financial performance in Q3 2025, with adjusted operating income reaching $44 million, or $1.05 per diluted share, and net income coming in at $45.9 million, or $1.10 per diluted share. Gross written premiums grew by 52% in the quarter, driven by the Agriculture unit, as well as other segments such as A&H, Captives, Surety, and Specialty programs. The company's combined ratio stood at 89.2%, indicating a strong underwriting performance. The actual EPS came out at $1.10, which is higher than the estimated $0.85 is not found but actual eps is 1.10 while the estimate was for '0.85' relative to actual at '0.71' for the previous quarter.

Publication Date: Nov -04

                                    📋 Highlights
                                    Record Operating Income:
                                                Achieved $44 million operating income and $38 million underwriting income in Q3 2025, with an 89.2% combined ratio.
52% Premium Growth:
                                                Gross written premiums surged 52%, driven by Agriculture, A&H, and Specialty units, with Ag premiums to be earned ratably over 12 months.
Strong EPS Performance:
                                                Adjusted operating income was $1.05 per diluted share, and net income reached $1.10 per diluted share, reflecting disciplined capital efficiency.
Specialty Programs Expansion:
                                                Specialty Programs contributed 13.4% of total premiums, with intentional growth from two key programs and elevated exposure growth (2–4% annually).
Apollo Acquisition Timeline:
                                                Expected to close in early 2026, with no changes to financing or timeline despite Skyward’s outperforming growth, remaining subject to regulatory approvals.

                                

Segmental Performance

The company's diversified portfolio drove growth across various segments, with Agriculture being the largest contributor. The growth in Specialty Programs is notable, with premium as a percentage of overall premium standing at 13.4%. According to Andrew Robinson, the growth in Specialty Programs is "intentional and thoughtful," with two notable programs contributing to the growth. The company's focus on non-P&C cycle-exposed businesses has helped it navigate the challenging market.

Outlook and Valuation

Analysts estimate next year's revenue growth at 47.8%, indicating a strong outlook for the company. With a Price-to-Book Ratio (P/B) of 1.9, the stock appears to be reasonably valued. The Combined Ratio of 89.2% demonstrates the company's ability to maintain underwriting profitability. Skyward Specialty's diversified portfolio and focus on specialty classes position it well for future growth.

Capital Efficiency and Leverage

Andrew Robinson highlighted that the company's lower capital levels might be beneficial, allowing for more discipline in deploying underwriting opportunities. The debt-to-capital ratio currently stands at 28%, which is not uncomfortable, and is expected to reduce over time due to organic capital growth. Mark Haushill noted that the company will conduct a deep dive review of its reserves in the fourth quarter, but there are no nonrecurring items or changes expected.

Apollo Acquisition

The company is on track to complete the Apollo acquisition in early 2026, subject to regulatory approvals. Andrew Robinson mentioned that Apollo's business is weighted towards specialty classes and is less exposed to the P&C market cycle. The acquisition is expected to bring in new opportunities and further diversify the company's portfolio.

3. NewsRoom

Regulatory Authorities and Minority Shareholders Approved Skyward Specialty Acquisition of Apollo Group; Skyward Specialty Provides Guidance for 2026

Dec -03

Source: globenewswire.com

Wall Street Analysts Think Skyward (SKWD) Could Surge 25.41%: Read This Before Placing a Bet

Dec -01

Source: zacks.com

Rep. Gilbert Ray Cisneros, Jr. Buys Skyward Specialty Insurance Group, Inc. (NASDAQ:SKWD) Shares

Nov -21

Source: defenseworld.net

Skyward Specialty Promotes John Burkhart to President, U.S. Property & Casualty

Nov -19

Source: globenewswire.com

Campbell & CO Investment Adviser LLC Purchases New Shares in Skyward Specialty Insurance Group, Inc. $SKWD

Nov -18

Source: defenseworld.net

Wall Street Analysts Believe Skyward (SKWD) Could Rally 25.95%: Here's is How to Trade

Nov -14

Source: zacks.com

Skyward Specialty Welcomes Christopher Peirce to Board of Directors

Nov -11

Source: globenewswire.com

Y Intercept Hong Kong Ltd Invests $619,000 in Skyward Specialty Insurance Group, Inc. $SKWD

Nov -06

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.50%)

6. Segments

Commercial Property and Casualty Products and Accidents and Health Insurance

Expected Growth: 8.5%

Growing demand for commercial property and casualty insurance, increasing adoption of health insurance among small and medium-sized enterprises, and rising awareness of risk management among businesses drive the growth of Skyward Specialty Insurance Group's products.

7. Detailed Products

Excess and Surplus Lines

Skyward Specialty Insurance Group, Inc. offers excess and surplus lines insurance products that cater to unique and hard-to-place risks, providing customized coverage solutions for businesses and individuals.

Admitted Insurance

Skyward Specialty Insurance Group, Inc. offers admitted insurance products that provide standard coverage options for businesses and individuals, backed by the financial strength of the company.

Program Business

Skyward Specialty Insurance Group, Inc. offers program business insurance products that provide specialized coverage solutions for niche industries and professions.

Reinsurance

Skyward Specialty Insurance Group, Inc. offers reinsurance products that provide risk management solutions for other insurance companies, helping them manage their risk exposure.

Fronting and Captive Solutions

Skyward Specialty Insurance Group, Inc. offers fronting and captive solutions that provide alternative risk financing options for businesses and organizations.

8. Skyward Specialty Insurance Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Skyward Specialty Insurance Group, Inc. is medium due to the presence of alternative insurance providers and financial institutions that offer similar products and services.

Bargaining Power Of Customers

The bargaining power of customers for Skyward Specialty Insurance Group, Inc. is low due to the company's specialized insurance products and services that cater to specific industries and niches.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Skyward Specialty Insurance Group, Inc. is medium due to the company's dependence on a few key suppliers for underwriting and claims services.

Threat Of New Entrants

The threat of new entrants for Skyward Specialty Insurance Group, Inc. is low due to the high barriers to entry in the insurance industry, including regulatory hurdles and capital requirements.

Intensity Of Rivalry

The intensity of rivalry for Skyward Specialty Insurance Group, Inc. is high due to the competitive nature of the insurance industry, with many established players vying for market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	16.36%
Debt Cost	6.26%
Equity Weight	83.64%
Equity Cost	6.26%
WACC	6.26%
Leverage	19.56%

11. Quality Control: Skyward Specialty Insurance Group, Inc. passed 8 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Horace Mann Educators

A-Score: 7.3/10

Value: 7.3

Growth: 5.0

Quality: 5.7

Yield: 7.0

Momentum: 9.0

Volatility: 9.7

1-Year Total Return ->

Universal Insurance Holdings

A-Score: 6.8/10

Value: 8.3

Growth: 6.2

Quality: 6.6

Yield: 6.0

Momentum: 8.5

Volatility: 5.3

1-Year Total Return ->

HCI Group

A-Score: 6.6/10

Value: 5.6

Growth: 8.2

Quality: 7.8

Yield: 3.0

Momentum: 9.0

Volatility: 6.0

1-Year Total Return ->

Safety Insurance

A-Score: 6.3/10

Value: 7.4

Growth: 3.9

Quality: 7.1

Yield: 8.0

Momentum: 1.5

Volatility: 9.7

1-Year Total Return ->

Global Indemnity

A-Score: 5.3/10

Value: 6.1

Growth: 4.2

Quality: 5.9

Yield: 8.0

Momentum: 2.0

Volatility: 5.7

1-Year Total Return ->

Skyward Specialty Insurance

A-Score: 4.9/10

Value: 6.1

Growth: 8.3

Quality: 6.7

Yield: 0.0

Momentum: 4.5

Volatility: 4.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

-8.84%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

6.26%

Skyward Specialty Insurance Group, Inc. - US8309401029

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on SKWD

1.c. Company Highlights

Higher Growth

Strong Momentum

Better Quality

Earnings Beats

Lower Yield

Revenues Miss

More Volatile

Revenues Beats

Medium Volatility

Earnings Miss

2. Skyward Specialty's Q3 2025 Earnings: A Strong Performance

Segmental Performance

Outlook and Valuation

Capital Efficiency and Leverage

Apollo Acquisition

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.50%)

6. Segments

Commercial Property and Casualty Products and Accidents and Health Insurance

Expected Growth: 8.5%

7. Detailed Products

Excess and Surplus Lines

Admitted Insurance

Program Business

Reinsurance

Fronting and Captive Solutions

8. Skyward Specialty Insurance Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Skyward Specialty Insurance Group, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

46.8$

Current Price

46.8$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA